Filing your Income Tax Return (ITR) can be stressful, and sometimes mistakes happen even with the best intentions. If you've discovered an error in your ITR for Financial Year 2024-25, don't panic! The Income Tax Department provides a solution through the 'Updated Return' facility.
What is an Updated Return (ITR-U)?
An updated return, filed using Form ITR-U, allows taxpayers to correct omissions or mistakes in their original ITR filing. This could include unreported income, incorrect deductions, or any other errors that need rectification.
Key Deadlines You Must Know
Timing is crucial when filing an updated return. The window for filing ITR-U for FY 2024-25 is limited:
- You can file within 24 months from the end of the relevant assessment year
- For FY 2024-25, this means you have until March 31, 2027
- Filing within 12 months attracts lower penalties
When Should You File an Updated Return?
Consider filing ITR-U in these scenarios:
- You discovered unreported income after filing your original return
- You claimed incorrect deductions or exemptions
- You misclassified your income heads
- You want to report additional tax liability voluntarily
Penalty Structure for Updated Returns
The tax department has implemented a graded penalty system:
- 25% additional tax if filed within 12 months
- 50% additional tax if filed between 12-24 months
- No updated return allowed after 24 months
Step-by-Step Process to File ITR-U
Filing an updated return is straightforward:
- Log in to the Income Tax e-filing portal
- Select 'File Updated Return' under the e-File menu
- Choose the relevant assessment year (2025-26 for FY 2024-25)
- Fill Form ITR-U with corrected information
- Pay additional tax and penalty, if applicable
- Submit the return and verify it
Important Considerations
Before filing your updated return, keep these points in mind:
- You cannot file ITR-U to claim additional refunds
- Losses cannot be increased through updated returns
- The department may still initiate scrutiny proceedings
- Maintain proper documentation for all corrections
Pro Tip: It's always better to file an accurate return initially, but if mistakes occur, the updated return facility provides a legal way to correct them and avoid more severe consequences.
